fund accounting

Definition

A system of accounting used primarily by non-profit or government organizations. For these and other similar organizations, it is more important for them to keep a record of how their money was spent, rather than how it was earned, unlike corporations. Their accounting records take the form of a collection of funds, each fund having a distinct purpose, ranging from operating expenses to funding the various activities of the organization.

Use fund accounting in a sentence

Fund accounting is more prevalent in non-profit organizations where it is more important to track how the organization is spending money rather than how it earns money.

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budgetary accountability temporary new account